With the signing of a 30-year concession deal to run and manage Container Terminal 2 (CT2) at the Dar es Salaam Port in Tanzania, Adani Ports and Special Economic Zone Ltd. (APSEZ), a prominent player in the port and logistics sector in India, has taken a big step towards realizing its worldwide goals. By taking this calculated risk, Adani is better positioned to expand its market share in East Africa and achieve future growth.
The Dar es Salaam Port is a key gateway for Tanzania, boasting a well-developed network of roadways and railways that facilitate trade within the region. CT2 itself is a crucial infrastructure asset, boasting four berths and an annual cargo handling capacity of one million TEUs (Twenty-foot Equivalent Units). In 2023, CT2 handled an impressive 8.2 million TEUs, accounting for an estimated 83% of Tanzania’s total container traffic.
Together with AD Ports Group and East Harbour Terminals Ltd (EHTL), APSEZ formed a joint venture named East Africa Gateway Ltd (EAGL) to oversee CT2. APSEZ’s commitment to the project is further cemented by its holding of a majority interest in EAGL. Furthermore, Tanzania International Container Terminal Services (TICTS) has sold a 95% share to EAGL for $39.5 million. By owning the port handling machinery and hiring the labor required for CT2’s operations, TICTS plays a crucial part. Adani will provide efficient and seamless terminal administration with TICTS.
Commenting on this development, Karan Adani, Managing Director of APSEZ, highlighted the company’s vision. He stated that securing the CT2 concession aligns with APSEZ’s ambitious goal of becoming a global leader in port operations by 2030. Adani expressed confidence that the company’s expertise and established network will significantly enhance trade volumes and foster stronger economic ties between its ports and East Africa. Furthermore, Adani emphasized the commitment to transforming Dar es Salaam Port into a world-class facility.
Adani’s expansion into Tanzania presents several potential benefits. The company’s experience in port management can significantly improve operational efficiency at CT2, potentially leading to faster cargo handling times and reduced costs for businesses. Additionally, Adani’s network could open doors for new trade routes and partnerships between Tanzania and other regions. This could stimulate economic growth in Tanzania and solidify Dar es Salaam Port’s position as a key East African trade hub.
However, there are several problems to consider. Integrating Adani’s systems and procedures with the existing operations at CT2 may necessitate careful planning and execution to achieve a smooth transition. Additionally, negotiating Tanzania’s regulatory climate will be critical to Adani’s long-term success.
All things considered, Tanzania and Adani both benefit greatly from the company’s acquisition of the CT2 concession. There is a significant chance for higher trade volumes, more efficiency, and regional economic expansion. Through adept handling of any obstacles, Adani can firmly establish itself as a prominent participant in the port industry in East Africa and facilitate the ongoing advancement of Tanzania’s trade infrastructure.
